China cuts US debt holdings after downgrade

[NNN0LHI]

http://www3.nhk.or.jp/daily/english/19_31.html

updated at 17:39 UTC, Oct. 19

China has been found to have sharply reduced its holdings of US government bonds after a major credit rating agency downgraded US debt for the first time in August.

Data released by the US Treasury Department on Tuesday show that China's holdings of US government bonds fell by 36.5 billion dollars in a month, to 1.137 trillion dollars at the end of August. China remains the largest foreign US creditor.

[Old and In the Way]

1. China better be careful...dump too much US debt and the remaining may be worth less.

Who else, other than China, is going to buy into our dyfunctional economy and financial institutions?

[MrNJ]

2. sharply?

36.5 / 1137 ~ 3%
Doesn't qualify as "sharply" in my book.
FUD, pure and simple.

[Samantha]

3. But China's US debt in no way compares to the U.S.' largest creditors

That is U.S. Domestic bondholders: 5.3 Trillion Dollars. The largest parts of this is the Social Security Trust Fund and the Medicare Trust Fund.

Not that I am in any way disputing the authenticity of your thread, it just always seems very interesting to me that when it comes to the issue of U.S. debt, the focus in always on foreign debt holders, and rarely do we turn our attention to simply the largest holder of U.S. debt. It is that 5.3 Trillion Dollars, a large chunk of which Wall Street (particularly hedge fund managers) would like to access in order to "invest" for us.

So why do you think, NNNOLHI, that our foreign debt holders consume so much of our debate and the domestic debt holders are seldom mentioned. I think it is by design. Look over there (while your pocket is being picked).

Please forgive me for interrupting your train of political thought.

Sam